China, which is officially considered now as the world’s second largest economy, continue to fuel its economic growth not only by producing most of the commodities the world market need, but its momentum also seem to be fired as well by the growing strength of its metal production.
In order for China to sustain its economic vigor it has to assure itself of a steady supply of oil from Iraq and even from Latin America where it is said that the leading Chinese refinery Sinopec has already acquired a 40 percent stake in the Brazilian branch of Spanish energy company Repsol.
According to Nobuo Tanaka, head of the International Energy Agency, China is now the largest energy consumer by their definition. Seventy percent of China’s energy needs comes from coal and this populous nation is the world’s second largest oil consumer after the U.S.
“There is in China a big supply concern of ensuring what they need — energy and food but also metals,” Philippa Malmgren of the Canonbury Group, said.
Not only will China be producing and supplying their own needs of metals for their various mega-construction projects which are “very metal intensive,” but has also to meet the structural demands of the emerging markets around the world.
“Although China is now the single most important consumer of industrial metals, … the next three places are typically filled by the United States, Japan and Germany,” said John Higgins of Capital Economics.
That being said, there is no doubt that what the world will be seeing next are upheavals in metal prices.
Quierosaber's Blog 